Adverse Action Disclosures

Updated 2026-05-17

Under the Equal Credit Opportunity Act (ECOA / Regulation B, 12 CFR 1002) and the Fair Credit Reporting Act (FCRA) and Fair Debt Collection Practices Act (FDCPA) (FCRA, 15 U.S.C. § 1681m), when a loan application is denied a specific "adverse action" notice is required. These disclosures include definitions, examples, notification of the action taken, a statement of the specific reasons (or the right to request them), and timing requirements.

Adverse action disclosures are crucial for ensuring fair lending practices and consumer notification. They also cover scenarios where a borrower refuses to provide demographic information, such as race or gender.

These disclosure requirements are often referenced alongside the Fair Credit Reporting Act (FCRA) and Fair Debt Collection Practices Act (FDCPA) (FCRA) and the Gramm-Leach-Bliley Act (GLBA) and Regulation P (GLBA), which also govern aspects of consumer information and privacy.